TMC NEWS

TMCNET eNEWSLETTER SIGNUP

Gambling costs fans their lives [China Daily: Hong Kong Edition]

(China Daily: Hong Kong Edition Via Acquire Media NewsEdge) Debts racked up on World Cup games can turn deadly, report He Na, Meng Jing and Cao Yin in Beijing
For millions of viewers in China and across the globe, the World Cup is a monthlong extravaganza of soccer and a chance to share the triumphs and losses with family and friends. For a limited number, though, it is a descent into the despair of unpayable debts racked up by gambling.

In one case, on June 27, a woman committed suicide at a hotel in Haikou, Hainan province, after losing more than 100,000 yuan ($16,000) gambling on the World Cup.

People.com.cn said the woman, surnamed Wang, 32, had previously placed bets on the outcome of matches and had lost tens of thousands of yuan before her husband settled most of her debts. In an effort to recoup the losses, she borrowed more than 100,000 yuan to bet on other matches but lost this money also.

Wang locked herself in a hotel restroom and lit charcoal before succumbing to the fumes. The police found a suicide note in which she expressed her remorse for the grief she knew her family would feel.

Wang was not alone in her despair. Several other suicides have been reported nationwide, and across the globe.

On June 10, a college student leaped to his death in Panyu, Guangdong province, after losing more than $3,000. The plight of those driven to suicide means that a harsh spotlight is being shone on gambling, both legal and illegal, especially sites set up overseas that may appear legitimate but are, in actual fact, scams.

According to the National Sports Lottery Center, the industry regulator, more than 150 million yuan in bets were placed on June 12 in the country, the tournament's opening day, three times the amount for the previous World Cup.

Statistics from the Beijing-based Caitong Consultancy, a lottery research institute, showed that bets hit 2.24 billion yuan within the first week of the World Cup, which roughly equals the total of 2.3 billion yuan during the whole 2010 World Cup in South Africa.

By midday on June 21, accumulated bets had soared to 4 billion yuan. Insiders predicted that bets placed during the World Cup would exceed 10 billion yuan.

Main platform
Huo Wei, in his late 20s, is a soccer fan who works in broadcasting in Beijing. He has bet 1,500 yuan since the event began, and while he has won some money back during the group phase, he has lost almost all of his winnings at the first stage of the knock-out phase.

"I have never bet on soccer before, but I found it really convenient. You don't even need to go out as you can place a bet on a computer or even on a mobile phone through a credit card or online payment apps," he said.

Huo said he often bet on JD.com Inc, China's second-largest e-commerce company.

"If you win, the winnings will be transferred to your account. Even my friend who works abroad asked me to place a bet for her," he said.

"To place a bet makes watching the match more interesting. But there is a contradiction. For example, I like Argentina, but I might back their opponents as the odds for winning are greater. In order to win more, I bet on Argentina losing," he said.

"I think the games, as long as big business is involved, may fall foul of backroom deals. So I never dreamed of being rich through gambling, but it can be fun if you bet just a small amount," he added.

Bets have taken off with the World Cup, and China's Internet titans are battling for a slice of the huge market.

Li Zichuan, an analyst with the Beijing-based Internet consultancy Analysys International, said that the World Cup is a major opportunity for companies to drive up sales.

"With the increasing Internet penetration in China, Internet, and the mobile Internet in particular, are more and more involved in people's daily lives and people are inclined to place bets online because it is more convenient," Li said.

Statistics from Caitong Consultancy showed that more than 70 percent of bets made during the World Cup are made online. But Li said that online lotteries overall accounted for roughly 10 percent of the total lottery sales market in China.

"Online lotteries usually account for more than 30 percent of overall lottery sales in developed countries. So it is a market with great potential," he said.

A recent report from Analysys International said that more than 50 percent of lottery buyers in China spent more than 10,000 yuan in 2013. Average spending on lotteries has been rising in the first quarter of 2014.

Many of China's Internet giants have been working hard to tap into this sector. Taobao.com, China's largest customer-to-customer portal, has reorganized its web page to make it easier for soccer fans to place their bets and offered those who spend more than 100 yuan a chance to win a 500 yuan bonus.

Sales for Taobao's lottery service soared since the event started, and more than 4 million bets were placed on the opening day. Within three days, the number of punters had surged to 6 million, according to the press office of Alibaba Group Holding Ltd, the owner of the Taobao platform.

Leading online lottery agent 500.com has seen lottery sales rise markedly, roughly three to five times the daily average before the World Cup, according to Pan Zhengming, CFO of 500.com Ltd.

Apart from Taobao and 500.com, a large number of China's online platforms and Internet firms, such as JD.com Inc and Tencent, also have tapped into online lotteries either by setting up lottery channels under their online marketplaces or selling lottery tickets through apps.

Underground banker
Despite the booming market, Li, of Analysys International, said that the online lottery market is still in its infancy in China as most of the companies are not licensed to sell tickets directly online.

Only two companies, 500.com and sporttery.cn, have gained the licenses to carry out pilot projects to sell online lotteries from the Ministry of Finance.

"The other online platforms can only serve as sales agents. And like any online transactions, there are risks that people's betting accounts can get hacked or they may possibly be cheated when buying online," he said.

Zhang Chao, 45, works in a State-run enterprise in Changchun, capital of Jilin province. He has lost about 10,000 yuan since the World Cup began.

"The reason that I am gambling is very simple. Sometimes it is too tiring to watch matches after midnight but if you have put on a bet you won't feel sleepy," he said.

He registered on a foreign lottery website and placed a bet. "We have a 'friend circle' on WeChat in which all of us bet illegally," he said.

He did not know who the banker was as a friend introduced him. He said he will bet more to win back his losses during the quarter finals and up to the final as the odds might be better.

The Internet security center of Qihoo 360 Technology Co has monitored the amount of World Cup lottery phishing websites and they have tripled since the tournament began. These lure unsuspecting customers to place bets in a designated fraudulent account.

Fighting back
The Ministry of Public Security released an emergency notice recently targeting gambling gangs and syndicates, especially online, and are beefing up online monitoring.

"I haven't had a moment off since June, especially since the World Cup started," said Wang Qi, a police officer from Wudaokou, Haidian district in Beijing, one of the busiest entertainment areas in the capital.

"We were told to enhance supervision on bars and entertainment places, to help prevent crimes and disputes arising from the World Cup."
He said many fans were gambling on the Internet while they were in bars. He was part of a designated team of about 40 police officers that carried out spot checks on bars and this will be a regular feature.

Police in Beijing did the groundwork even before the tournament started and 750 illegal gambling gangs have been smashed and 3,961 suspects arrested and detained. More than 2.3 million yuan of illicit gambling funds have been retrieved.

"We are carrying out a 'zero tolerance' campaign to tackle gambling online including those that gamble through domestic and overseas casinos, lottery corporations overseas, representatives or bankers that set up gambling agents in the capital, founders of the gambling websites and underground illegal private banks," Beijing police said in a newsletter.

Police across the country have also launched a crackdown on soccer gambling.

The police are also reminding citizens that the majority of gambling websites are registered overseas and are illegal.

Contact the authors at hena@chinadaily.com.cn, caoyin@chinadaily.com.cn and mengjing@chinadaily.com.cn
Han Junhong contributed to this story.